Common use of Additional Manufacturing Clause in Contracts

Additional Manufacturing. At any time after the [ * ] anniversary of the Effective Date, Teva shall have a right, upon written notification to Alexza, to elect to have a Third Party manufacturer that is selected by Teva and reasonably acceptable to Alexza, qualified to manufacture the Product (an “Additional Manufacturer”). Alexza shall thereafter prepare an estimated reasonable budget and implementation plan for approval by Teva to enable such Additional Manufacturer to manufacture the Product. Upon approval by Teva of the implementation plan and budget, Alexza shall enter into an agreement with such Additional Manufacturer to conduct Alexza manufacturing Know-How transfer to enable the Additional Manufacturer to manufacture the Product. All costs and expenses in engaging and qualifying the Additional Manufacturer shall be borne by Teva. The agreement with the Additional Manufacturer shall provide that any time prior to the [ * ] anniversary of the First Commercial Sale, only upon the written notice from Teva (copied to Alexza) of the occurrence of a Failure Event (as defined below in Section 7.5) shall the Additional Manufacturer manufacture Product for Teva. For clarity, Teva shall not initiate or permit any manufacturing by a Third Party or Additional Manufacturer prior to the [ * ] anniversary of the First Commercial Sale, except as provided in Section 7.5. Notwithstanding the foregoing, if Teva desires to serve as the Additional Manufacturer, Alexza and Teva shall discuss in good faith whether Teva should be chosen pursuant to this Section 7.4 as the “Additional Manufacturer” instead of a Third Party manufacturer.